Brazil's gross debt-to-GDP ratio unexpectedly drops in January

BRASILIA, March 14 (Reuters) - Brazil's public sector gross debt as a share of gross domestic product (GDP), a key solvency indicator, came in below market expectations in January, central bank data showed on Friday.

The ratio declined to 75.3% of GDP from 76.1% in December, standing well below the 76.2% forecast in a Reuters poll of economists.

According to the central bank, the 0.8 percentage-point drop was mainly driven by net debt redemptions and the effect of nominal GDP growth.

The public sector recorded a primary surplus of 104.096 billion reais ($17.92 billion) for the month, slightly higher than the 102.135 billion reais expected by economists polled by Reuters, bringing the 12-month rolling deficit to 0.38% of GDP.

The central government alone recorded a deficit of 0.37% of GDP in the 12 months through January. President Luiz Inacio Lula da Silva's administration targets a zero primary deficit this year, with a 0.25% of GDP tolerance margin either way.

($1 = 5.8089 reais)